Missouri Chamber comes out stronger in favor of Medicaid expansion, citing losses to taxpayers
This article first appeared in the St. Louis Beacon, Dec. 9, 2013 - The Missouri Chamber, which publicly has blasted the Affordable Care Act, has nonetheless come out with its strongest statement to date this week in favor of expanding the state's Medicaid rolls, as recommended by the law.
The chamber, the state's largest business group, notes that Missouri is among the top states losing out on the federal money involved – and says that the state’s businesses and hospitals will suffer.
According to a new study by the Commonwealth Fund, the chamber cites figures showing that Missouri stands to lose $2.2 billion a year in federal money by 2022. The annual losses would actually be higher during the first years of the expansion because the federal government would pay all of the costs for the first three years. The federal government would pay at least 90 percent thereafter.
Under expansion, Missouri would likely add close to 200,000 people to its Medicaid rolls by increasing eligibility requirements to match those mandated by the ACA -- 138 percent of federal poverty level. Missouri's maximum eligibility for adults now is 19 percent of the poverty level.
The state chamber cites the study -- How States Stand to Gain or Lose Federal Funds by Opting In or Out of the Medicaid Expansion, by Sherry Glied and Stephanie Ma of New York University's Wagner Graduate School of Public Service – as the first one “to calculate the net cost to taxpayers in states turning down the Affordable Care Act's Medicaid expansion.”
“Now hospitals are looking at significant cuts, without receiving the additional Medicaid funding if state lawmakers choose not to expand it,” said the chamber's chief executive Dan Mehan. “And how will they recover those costs? Health-care facilities will recoup costs by charging more for privately insured patients in order to cover the losses by treating Medicaid and Medicare patients and the uninsured.”
“Unfortunately for Missouri chamber members, that cost shifting hits Missouri employers hardest,” the group continued.
“Employers are the majority purchasers of private insurance and are already bracing themselves to bear the brunt of the significant costs increases through the implementation of Obamacare,” Mehan said. “Choosing not to receive the federal funding through the expansion of Medicaid is only going to add to the cost shift on employers. We don’t like Obamacare, but unfortunately it is the law and these are the rules under which we have to play.”
The chamber is making its push just weeks before the Missouri General Assembly goes back into session.
Republican legislative leaders have opposed the expansion for philosophical and political reasons; they also have questioned whether the federal government will follow through with its aid. Two legislative panels heard testimony supporting expansion during hearings this summer but have opted against backing the idea.
Still, Mehan is warning of the costs to businesses if expansion fails to occur.
“Whether Missouri chooses to expand Medicaid or not, Missouri taxpayers are still going to pay the higher costs of the ACA,” he said. “It does not make economic sense to forgo the federal funding. Not only will taxpayers lose the federal taxes they have paid in for a program they can’t use, they will wind up paying more for health coverage to make up for hospital shortfalls.”
The Commonwealth study says that Texas stands to lose the most in federal funds, about $9.2 billion a year by 2022. Florida would lose $5 billion annually, followed by Georgia ($2.9 billion), Virginia ($2.8 billion), and North Carolina ($2.5 billion).
In Virginia, Gov.-elect Terry McAuliffe, a Democrat, has called for participating in Medicaid expansion -- a change from the outgoing GOP administration.